Reversing Bollinger and Keltner Squeeze Breakouts

Summary

The document gives a brief contrarian rule for trading breaks from a Bollinger Band and Keltner Channel squeeze. When a candle breaks below both the lower band and channel and closes there, the author says to take a long position; a break above the upper boundaries prompts a short. This reverses the usual direction of trading a breakout, treating an extreme move out of the squeeze as a reversal opportunity.

Release notes mention a stop-loss correction and an option to require a signal candle, with the stated candle-color condition depending on trade direction. The page provides no indicator settings, detailed entry or exit rules, instrument or timeframe, backtest, or evidence of results. Because the available description is only a short script listing, it is not possible to assess how the squeeze is defined, how stops are placed, or whether the rule survives costs and different market regimes.

Key ideas

• The described setup takes a long position after a close below both the lower Bollinger Band and Keltner Channel during a squeeze.
• It takes a short position after a break above the upper boundaries.
• The approach trades channel breaks in the opposite direction, implying a reversal interpretation.
• Release notes refer to a stop-loss fix and an optional signal-candle condition.
• The page provides no backtest evidence or enough detail to judge robustness.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.